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China's economy grew by 4.5% in the third quarter, beating market expectations, driven by strong exports despite sluggish domestic demand.
The National Bureau of Statistics of China announced today (October 19) that the gross domestic product (GDP) for the third quarter increased by 4.5% compared to the same period last year.
This exceeded the market forecast of 4.4% compiled by Reuters and Bloomberg.
China's quarterly GDP growth stood at 5.0% in the first quarter, but slowed to 4.3% in the second quarter, marking the lowest level in about three years since the fourth quarter of 2022.
China's annual growth target for this year is set between 4.5% and 5%, with the GDP growth rate for the first three quarters reaching 4.6% year-on-year.
With growth for the first three quarters remaining within the target range, analysts note that authorities have been relieved of the burden of implementing aggressive stimulus measures in the fourth quarter.
Consequently, the value of the yuan against the dollar reached 6.6826 yuan during trading hours, hitting a high not seen in about four years since July 2022.
Despite sluggish domestic demand, China continues to see strong exports amid the global artificial intelligence (AI) boom. Its trade surplus for January through September reached $938.11 billion, and it is expected to surpass $1 trillion as early as the release of October statistics.
While discussions point to the possibility of China setting a new record for its annual trade surplus following last year's $1.1889 trillion, growing conflicts with trading partners, including the European Union (EU), remain a challenge.
China's industrial production and retail sales indicators for last month also showed relatively solid performance.
Industrial production in September rose by 5.5% compared to the same period last year, marking the highest growth rate since last March (5.7%).
This surpassed the growth rate for August (5.2%) and met the market forecast compiled by Reuters (5.5%).
Retail sales, a consumption indicator, increased by 1.1% year-on-year in September, also recording the highest growth rate since March (1.7%).
This exceeded the August growth rate (0.4%) and the Reuters-compiled market forecast (0.6%). Excluding automobile purchases, the retail sales growth rate stood at 3.9%, the highest since October of last year.
The total fixed-asset investment for January through September dropped by 7.2% year-on-year, maintaining the same rate of decline as January through August.
Fixed-asset investment excluding real estate development fell by 4.2%, while investments related to intellectual property products increased by 9.3%.
Real estate development investment for January through September dropped by 20.6% year-on-year, showing a wider decline than January through August (-19.9%).
According to Bloomberg data, new home prices in China's 70 major cities fell by 0.14% in September compared to the previous month.
However, as the rate of decline narrowed compared to August (-0.17%), expectations for market recovery persist.
The urban unemployment rate in September stood at 5.2%, down 0.1 percentage points from the previous month, though this is interpreted as being influenced by the so-called "gig economy," which centers on temporary employment.
The National Bureau of Statistics evaluated that "the Chinese economy weathered pressures and moved stably from January to September," adding that "production and supply grew relatively fast, and the growth trend of foreign trade was sound. Employment and prices remained generally stable."
It also noted that the industrial production growth rate for the first nine months was 5.3%, highlighting that "support from equipment manufacturing (10.2%) and high-tech manufacturing (14.3%) was distinct."
At the same time, the bureau warned that "the international environment is complex and undergoing major changes, and the problem of insufficient domestic demand remains prominent," urging that future efforts be directed toward "ensuring macro policies take effect, expanding domestic demand, and optimizing supply."
An official from the National Bureau of Statistics also remarked that the 4.6% growth rate for the first three quarters was "hard-earned."
Raymond Yeung, chief economist at Australia and New Zealand Banking Group (ANZ), maintained China's annual growth forecast at 4.6% while assessing that "downside risks remain. Weak domestic demand, persistent deflationary pressures, and the property sector slowdown continue to constrain economic activity."
Meanwhile, regarding China's major raw material production in September, ahead of the full-fledged heating season, coal production decreased by 6.8% year-on-year to 390 million tons.
Crude oil production increased by 2.2% to 18.21 million tons, while natural gas production fell by 1.0% to 21 billion cubic meters.
Amid the fallout from the Iran war, oil refining (crude processing) recorded 57.48 million tons, down 8.4% from the same month last year.
(Photo: Capture from National Bureau of Statistics website, AP, Yonhap News)
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